Legality of Madison casino games an issue with state

Ho-Chunk Nation tribal President Jon Greendeer vowed Wednesday to fight the state's efforts to shut down the poker room at the tribe's casino in Madison.

The state sued the Black River Falls-based tribe on Tuesday over the legality of the electronic poker games offered at its Ho-Chunk Gaming Madison casino. The state is seeking an injunction shutting the poker games that have been offered at the casino since November 2010.

"If I thought the games were illegal, I would have put them in the taverns," Greendeer quipped, taking a swipe at the proliferation of illegal slot machines in taverns. "The passive acceptance of tavern gaming is essentially legalizing it."

Greendeer said the Madison casino is a key contributor to the Ho-Chunk Nation's gaming revenue.

In its suit, the Department of Justice argues the Ho-Chunk is not is not permitted to offer Las Vegas casino games in its Madison facility. Vegas-style games, known in federal law as Class III games, are only allowed at the Ho-Chunk's flagship casino near Wisconsin Dells, its smaller casinos near Black River Falls and Nekoosa as well as its Tomah and Wittenberg casinos.

Since the Madison casino is a Class II facility - meaning it is regulated by the tribe and the National Indian Gaming Commission - it is limited to bingo style games. Though the 1,100 slot machines in the Madison casino look and act like those found in any casino, they are linked to bingo-type games, so they are considered Class II games. The slot machines are not included in the state legal action.

The slot machines provide the bulk of the facility's profits, Greendeer said.

The tribe agues the computerized poker games are also legal and off-limits to state regulators because the house does not bank the games. In other words, the gamblers play against each other and not against the house. "It's really not a skin game," Greendeer said.

Therefore, the tribe says the games fall into the Class II category - a section of the law that covers bingo, pull tabs and similar games.

The electronic poker games do, however, allow up to 10 gamblers at a table who can play a variety of electronic poker games. The casino can "customize our tables to offer any no limit or limit games," the casino's web site states.

Even though the Madison casino cannot offer the full range of Vegas games, such as blackjack, craps and roulette, Greendeer said it is profitable.

As a Class II facility the Madison casino it is not regulated by the state and does not have to share any of its winnings with state. The tribe pays the state up to 5.5% of its net win - that is, the amount of money lost by gamblers at its Class III casinos.

All of Wisconsin's 11 tribes operate Class III casinos and pay a fee to the state.

In fact, because of the lower overhead and not having to share any revenue with state, Greendeer said the Madison casino is frequently more profitable than the tribe's smaller casinos.

"I would suspect a Class II facility might actually be more profitable for the nation in the long run," Greendeer said adding there are no plans to make such a move.

Last year an arbitrator ruled that the electronic poker games were Class III Vegas-style games, which would make them illegal in the Madison gambling hall. That decision, however, was later dismissed in federal court making it necessary for the state to seek the injunction, according to a spokeswoman for the Department of Justice.

Greendeer said he was confident of the tribe's position, noting that before the tables were installed it received a legal opinion from the National Indian Gaming Commission that indicated they were legal.